Piramal Pharma Q4 Review: Operationally Inline; FY25 Ends On A Strong Note, Says Motilal Oswal —Maintains Buy

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Motilal Oswal Report

We cut our earnings estimate of Piramal Pharma Ltd. by 47%/33% for FY26/FY27, factoring in-

1. inventory normalization for one product in the contract development manufacturing organisation segment,

2. inconsistent recovery in funding biotech projects, thus affecting the outlook of the CDMO business, and

3. lower operating leverage.

We value Piramal Pharma on an SoTP basis (17x EV/Ebitda for CDMO business, 12 times EV/Ebitda for CHG business, and 13x EV/Ebitda for consumer health business) to arrive at a target price of Rs 250.

While FY26 would be the year of consolidation in revenue for Piramal Pharma, it continues to invest in-

1. potential areas like ADCs/peptides/sterile injectables within the CDMO segment,

2. capacity expansion in the CHG segment, and further improvement in profitability in the ICH segment.

Accordingly, we build ~3x earnings over FY25-27. Reiterate Buy.

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